Escalade, Inc. (NASDAQ: ESCA), a leading manufacturer and seller of sporting goods and recreation equipment, announced Wednesday that its CEO and President Walter P. Glazer, Jr. plans to retire at the end of 2024. The company's Board of Directors will initiate a thorough search for his successor, considering both internal and external candidates for the role.
Glazer, an Escalade shareholder since 1991 and a Director for the last nine years, will maintain his involvement with the company by continuing to serve on the Board, subject to annual shareholder approval. During his tenure as CEO, Escalade experienced significant growth and adapted to changes in demand post-pandemic.
Key achievements under his leadership include the acquisition of Brunswick (NYSE:BC) Billiards, a shift towards a decentralized, consumer-focused organizational structure, and strategic asset optimization, including the sale of the Rosarita, Mexico facility.
Ned Williams, Lead Independent Director of Escalade, commended Glazer for his dedication and leadership, which have been instrumental in the company's growth and transformation. Williams emphasized Glazer's commitment to developing future leaders and delivering value to consumers and trade partners, setting the stage for Escalade's ongoing success.
Founded in 1922 and based in Evansville, Indiana, Escalade's mission is to connect family and friends and create memorable moments through their products. The company's portfolio includes brands like Bear® Archery, STIGA® table tennis, and American Heritage Billiards®, among others. Escalade's products are sold online and in major retailers across the nation.
The Nominating and Corporate Governance Committee of Escalade's Board of Directors, along with an executive search firm, is considering both internal and external candidates for the position.
On the financial front, Escalade reported a 7.7% decrease in net sales for the second quarter of 2024 but maintained a gross margin of 24.2%. The company managed to reduce its high-interest variable rate debt by $8.6 million, supported by a nearly 60% increase in cash flow from operations. Escalade's leading brands experienced a surge in consumer demand, with a 28% increase in direct-to-consumer e-commerce volumes.
Escalade's international sales grew by 15%, especially in Europe, Australia, New Zealand, and China. The company announced plans to divest its Rosarito property and ruled out expansion into the apparel industry.
InvestingPro Insights
As Escalade, Inc. (NASDAQ: ESCA) navigates a leadership transition with the upcoming retirement of CEO Walter P. Glazer, Jr., the company's financial health and market performance remain crucial for investors. According to InvestingPro data, Escalade is currently trading at a P/E ratio of 14.99, which is noteworthy given the company's strong free cash flow yield—a factor highlighted by an InvestingPro Tip. This indicates that the company is valued attractively relative to its near-term earnings growth potential.
InvestingPro data also shows that Escalade has maintained a solid track record of dividend payments, with dividends distributed consistently for 15 consecutive years. This could be a sign of the company's commitment to returning value to shareholders, a commitment that may continue under new leadership. The current dividend yield stands at an appealing 4.67%, as of the last recorded date, which was on July 8, 2024.
Despite recent market volatility, another InvestingPro Tip points out that Escalade's liquid assets exceed its short-term obligations, suggesting a robust liquidity position that could support the company through its transition period and beyond. This financial stability is accompanied by a profitability streak over the last twelve months, as evidenced by the basic EPS (Continuing Operations) of 0.85 USD.
For investors seeking a more in-depth analysis, InvestingPro offers additional tips on Escalade, Inc. To explore these insights further, including the company's trading position near its 52-week low and more detailed financial metrics, visit the InvestingPro platform at https://www.investing.com/pro/ESCA for comprehensive analysis and exclusive tips.
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